More Harassment of Consumers by Navy Federal Credit Union
In a previous article, I wrote about a client in the military that had suffered from harassment at the hands Navy Federal Credit Union (“NFCU”). Now another client recently retained by my office has been victimized by in-house collection agents for NFCU. After leaving several messages for my client at work, an NFCU employee finally threatened contact the HR department at my client's employer and actually did end up leaving a message for the HR department.
Under California law, contacting the debtor’s employer is only permissible if it is made for the purposes of verifying the debtor's employment, locating the debtor, or effecting garnishment, after judgment, of the debtor's wages, or in the case of a medical debt for the purpose of discovering the existence of medical insurance. NFCU had already verified my client's employment and location as shown by the multiple voicemail messages left for my client. One NFCU collection agent had even expressed the suspicion that she had spoken directly with my client already, believing that my client had lied about her identity during the phone call. Under those circumstances, further contact with the employer was neither necessary nor permitted.
Consumer debtors in California are protected from creditor harassment by the Rosenthal Fair Debt Collection Practices Act. A debtor can sue for statutory damages ranging from $100 to $1,000 for each type of violation. Some acts, such as suing for a time-barred debt, constitute a violation of multiple sections of the Rosenthal Act. A debtor can also sue for actual damages such as out of pocket expenses to see a doctor to alleviate stress or expenses such as medication or legal advice. Debtors can also sue for emotional distress under extreme circumstances.
When my client in this matter files for bankruptcy, we will list the Rosenthal Act claims against NFCU and then be filing a lawsuit in state court at the appropriate time. I will post more details in the coming months as the case progresses.
Under California law, contacting the debtor’s employer is only permissible if it is made for the purposes of verifying the debtor's employment, locating the debtor, or effecting garnishment, after judgment, of the debtor's wages, or in the case of a medical debt for the purpose of discovering the existence of medical insurance. NFCU had already verified my client's employment and location as shown by the multiple voicemail messages left for my client. One NFCU collection agent had even expressed the suspicion that she had spoken directly with my client already, believing that my client had lied about her identity during the phone call. Under those circumstances, further contact with the employer was neither necessary nor permitted.
Consumer debtors in California are protected from creditor harassment by the Rosenthal Fair Debt Collection Practices Act. A debtor can sue for statutory damages ranging from $100 to $1,000 for each type of violation. Some acts, such as suing for a time-barred debt, constitute a violation of multiple sections of the Rosenthal Act. A debtor can also sue for actual damages such as out of pocket expenses to see a doctor to alleviate stress or expenses such as medication or legal advice. Debtors can also sue for emotional distress under extreme circumstances.
When my client in this matter files for bankruptcy, we will list the Rosenthal Act claims against NFCU and then be filing a lawsuit in state court at the appropriate time. I will post more details in the coming months as the case progresses.
About the Author: Carl H. Starrett II has been a licensed attorney since 1993 and is a member in good standing with the California State Bar and the San Diego County Bar Association. Mr. Starrett practices in the areas of bankruptcy, business litigation, construction, corporate planning and debt collection.
3 Comments:
Collection agencies are tightening the grip on consumers in debt with the burst of the cc bubble. Sad that we have to a. have creditors give us credit we can't manage and b. turn around and throw us to the wolves once the inevitable happens...
I agree. I personally ran into financial difficulities regarding a car loan and credit card with NFCU. I didn't experience much harrassment with the credit card issue, However, I was paying something on my loan, (I was behind) and had submitted a package with a representative at NFCU to have the two payments consolidated into one payment ( I explained my hardship situation) and after waiting for a response from mgmt. which never came, they discharged my loan and sent me a letter with options for payments after they reported the discharge to the credit bureaus - which is what I had asked for in the beginning. I couldn't believe it, especially after the rep told me just early last year they were in the practice of writing loans off without the debtor owing one red cent. I was paying on my debts and not once tried to get out of paying.
I have a major concern and would appreciate any help...Today I came home and checked my account and noticed that I have a "$0" available balance. Called NFCU and they said my account is on hold by LCR (Loan charge-off folks...). According to the duty idiot who couldn't escalate to anyone live... he looked briefly into my records and said the money was on-hold based on a "short sell" of my house from 2005 (which settled on 9-12-2009). I had that loan discharged in a bankruptcy on 8-31-2005. Since then, I have always had money passing through that account ever since with no problem. All of a sudden Ms. Kim Brown has decided to put a hold on my account late on a Friday (today...and being on the West Coast...they were closed for the weekend when I called about this issue...). So my question is...can they legally collect on a debt that was legally discharged on 8-31-2005 under the auspices of a short-sell that occured on 9-12-2009?
Thanks for any advice...
Paul
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